MISHRI - EXEMPTED GOODS!!!!!!!!!!

Mishri is a form of sugar …. It is not sugar………

Recently a clarification bearing distinctive no. CTS-69/2006/88 has been issued on 27^th April, 2012 and it has been clarified that Makhana, Nakuldana and Mishri are nothing but sugar and is exempted under the Assam Value Added Tax Act, 2003.

I may be forgiven for saying something in contrary to the aforesaid clarification. What is being exempted under the Assam Value Added Tax Act, 2003 is ‘sugar’ and not ‘sugar in any form’.

Sugar as defined in the Central Excise Tariff Act, 1985 and adopted in section 14 of the Central Sales Tax Act, 1956 means any form of sugar in which the sucrose content would be more than 90%. Whereas the Schedule-I appended to the Assam Value Added Tax Act, 2003 exempt ‘sugar’. It may be emphasized that there is difference between two terms, i.e.‘any form of sugar’ and ‘sugar’. Mishri, Batasa etc. are undoubtedly a form of sugar, but as per my little knowledge, these goods cannot be treated as ‘Sugar’.  Case of ‘Commissioner of Sales Tax vs. Puran Chand and Sons [48 STC 284 (DEL)]’ may also be referred to, wherein the Hon’ble Court held “We are of the view that the definition of the term "sugar" given in the Central Act is given for purposes of that Act. Sugar as used in the local Act in entry 9 of the Second Schedule must be understood to be sugar which is understood to be that commodity by the common man or by a shopkeeper or a trader or a customer”.  A reference may also be made to an earlier clarification no. CTS-77/2007/270 dated 22^nd November, 2011 issued by then Commissioner of Taxes, Government of Assam.

I leave it upon the learned readers to think and decide that whether the aforesaid goods such as Makhana, Nakuldana and Mishri are exempted as ‘sugar’. In my humble opinion the aforesaid goods are ‘sugar’ as stipulated in CST Act and the said goods are liable to be taxed as declared goods.

If the aforesaid clarification is given an extended meaning, many new issues may be emerged in near future, such as:- Vermicilli/ Sewai is nothing but Maida and should exempted! Besan is nothing but pulses or gram,  and so on…….

Your honour .. please………

O.P. Agarwalla